Success and Failure Among High-Potential Startup Projects

High-potential start-ups are often regarded as pivotal for economic development due to their role in creating new jobs and introducing innovations. However, little is known about the determinants that influence the start-up process, largely because of the limited availability of datasets that track high-potential projects over time. This research aims to address this gap by following a cohort of 98 nascent projects over several years. We analyze the duration of the start-up process and find that even after five years, roughly two-thirds of the projects have neither reached the stage of an operating firm nor haven been abandoned. Additionally, we examine the effects of human capital, financial capital, and social capital on various outcome variables, including survival, growth, sales, patents, and employment creation. Research experience and time invested are the only two variables that consistently predict success for high-potential projects.